International capital flows and financialisation of the South African economy

The Development Policy and Analysis Division (DPAD) joined hands with the Economic Development Department  (EDD) of South Africa to organize a high-level policy workshop on the International Capital Flows and Financialisation of the South African Economy: Policy Options for Stimulating Employment-driven New Growth Path in Pretoria, South Africa on 3-4 October 2013. Ms. Shamshad Akhtar, Assistant Secretary-General for Economic Development, delivered the keynote address at the workshop. Taking into account the persistently high level of unemployment (around 24%) and income inequality (Gini coefficient of 0.69) confronting South Africa, Ms. Akhtar underscored that the Government needed to rely on an appropriate set of capital market and macro-prudential regulations, prudent macroeconomic management, and structural reforms to optimize the benefits of private capital flows and promote long-term investment in the productive sector.

Minister of Economic Development Embrahim Patel (at right) thanked the UN Department of Economic and Social Affairs (UN/DESA) for playing a “catalytic role” in bringing together all stakeholders in South Africa to discuss these critical policy challenges. He expressed his optimism that UN/DESA would continue to support the capacity development efforts of EDD for evidence-based research and policy analysis.

The policy dialogue brought together a group of Ministers, including Rob Davies, Minister for Trade and Industries; Thembelani Nxesi, Minister for Public Works; and Jeremy Cronin, Deputy Minister for Public Works. The workshop also included 60 senior officials from various economic ministries, including the National Treasury and the South African Reserve Bank (SARB) as well as 18 central bankers and finance officials from the Republic of Korea, Chile, India, Swaziland, Lesotho, Bangladesh, Bhutan and Indonesia.